PROJECT DESCRIPTION (ABSTRACT) This proposal explores the neural and psychological mechanisms that underlie economic decision-making behavior in older adults. Economic decisions are a critical component of everyday life, and may have special relevance for older adults (e.g., saving vs. spending decisions, retirement planning, health care choices, and medication compliance). Basic research in the cognitive neuroscience of aging has suggested that older adults show declines in the ability to control thoughts and actions based on internal goals, and that this may stem from age-related changes in the function of the lateral prefrontal cortex and mid-brain dopamine system. Yet currently, very little is known about whether and how these cognitive and neural changes associated with advancing age impact economic-related behaviors. The current proposal provides a highly novel perspective on this issue, by leveraging and integrating theoretical frameworks from three areas: a) the cognitive neuroscience of aging; b) neural mechanisms of cognitive control; and c) behavioral economics research. A unifying theme of the proposed studies is the use of the discounting framework. This framework provides a means of formally modeling how various cost factors, such as the delay, probability, or cognitive effort, are combined with the size of the outcome to determine its (discounted) subjective value, and whether choices involving gains and losses differ in this regard. The proposal extends our previous collaborative efforts using this framework to a series of studies that integrate behavioral, mathematical modeling, and neuroimaging methods. A key feature of these studies is the use of innovative experimental paradigms that enable discovery of fundamental components of economic decision-making, as well as determination of how cognitive control interacts with affective and motivational factors, and how these components and their interaction are affected by advancing age. The findings of these studies promise to provide critical new data regarding economic choice behavior in older adults, which might be used to develop interventions that can promote adaptive decision-making throughout the life course.